Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 26, 2020 | Jul. 15, 2020 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 26, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-09249 | |
Entity Registrant Name | GRACO INC. | |
Entity Incorporation, State | MN | |
Entity Tax Identification Number | 41-0285640 | |
Entity Address, Address Description | 88 - 11th Avenue N.E. | |
Entity Address, City or Town | Minneapolis, | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55413 | |
City Area Code | (612) | |
Local Phone Number | 623-6000 | |
Title of 12(b) Security | Common Stock, par value $1.00 per share | |
Trading Symbol | GGG | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 166,710,627 | |
Amendment Flag | false | |
Entity Central Index Key | 0000042888 | |
Current Fiscal Year End Date | --12-25 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 |
Consolidated Statements of Earn
Consolidated Statements of Earnings (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
Income Statement [Abstract] | ||||
Revenues | $ 366,892 | $ 428,328 | $ 740,459 | $ 833,198 |
Cost of Goods and Services Sold | 184,363 | 201,374 | 359,299 | 390,202 |
Gross Profit | 182,529 | 226,954 | 381,160 | 442,996 |
Product development | 17,948 | 17,324 | 35,029 | 33,893 |
Selling, marketing and distribution | 48,831 | 60,441 | 106,219 | 121,258 |
General and administrative | 36,015 | 36,828 | 70,365 | 70,957 |
Impairment | 34,962 | 34,962 | 0 | |
Operating Earnings | 44,773 | 112,361 | 134,585 | 216,888 |
Interest expense | 3,258 | 3,431 | 5,744 | 6,966 |
Other expense (income), net | (510) | 1,119 | 4,713 | 1,388 |
Earnings Before Income Taxes | 42,025 | 107,811 | 124,128 | 208,534 |
Income taxes | 13,193 | 19,674 | 22,478 | 33,648 |
Net Earnings | $ 28,832 | $ 88,137 | $ 101,650 | $ 174,886 |
Basic earnings per share | $ 0.17 | $ 0.53 | $ 0.61 | $ 1.05 |
Diluted earnings per share | $ 0.17 | $ 0.51 | $ 0.59 | $ 1.02 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Earnings | $ 28,832 | $ 88,137 | $ 101,650 | $ 174,886 |
Components of other comprehensive income (loss) | ||||
Cumulative translation adjustment | 6,756 | 1,232 | 2,079 | 2,401 |
Other Comprehensive (Income) Loss, Defined Benefit Plan, before Reclassification Adjustment and Tax | 2,446 | 1,910 | 5,195 | 4,037 |
Pension and postretirement medical liability adjustment | (554) | (423) | (1,169) | (893) |
Other comprehensive income | 8,648 | 2,719 | 6,105 | 5,545 |
Comprehensive Income | $ 37,480 | $ 90,856 | $ 107,755 | $ 180,431 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 26, 2020 | Dec. 27, 2019 |
Current Assets | ||
Cash and cash equivalents | $ 432,708 | $ 220,973 |
Accounts receivable, less allowances of $6,000 and $5,300 | 282,856 | 267,345 |
Inventories | 291,442 | 273,233 |
Other current assets | 31,286 | 29,917 |
Total current assets | 1,038,292 | 791,468 |
Property, Plant and Equipment | ||
Property, Plant and Equipment, net | 327,476 | 325,546 |
Goodwill | 338,735 | 307,663 |
Other Intangible Assets, net | 162,271 | 162,623 |
Operating Lease, Right-of-Use Asset | 28,807 | 29,891 |
Deferred Income Tax Assets, Net | 33,968 | 39,327 |
Other Assets | 32,910 | 35,692 |
Total Assets | 1,962,459 | 1,692,210 |
Current Liabilities | ||
Notes payable to banks | 20,597 | 7,732 |
Trade accounts payable | 48,259 | 54,117 |
Salaries and incentives | 35,223 | 51,301 |
Dividends payable | 29,464 | 29,235 |
Other current liabilities | 176,837 | 142,937 |
Total current liabilities | 310,380 | 285,322 |
Long-term Debt | 400,000 | 164,298 |
Retirement Benefits and Deferred Compensation | 184,486 | 182,707 |
Operating Lease, Liability, Noncurrent | 21,860 | 24,176 |
Deferred Income Tax Liabilities, Net | 10,165 | 10,776 |
Other Non-current Liabilities | 8,600 | 0 |
Shareholders’ Equity | ||
Common stock | 166,693 | 167,287 |
Additional paid-in-capital | 623,803 | 578,440 |
Retained earnings | 400,154 | 448,991 |
Accumulated other comprehensive income (loss) | (163,682) | (169,787) |
Total shareholders’ equity | 1,026,968 | 1,024,931 |
Total Liabilities and Shareholders’ Equity | $ 1,962,459 | $ 1,692,210 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Jun. 26, 2020 | Dec. 27, 2019 |
Statement of Financial Position [Abstract] | ||
Allowance for Credits | $ 6 | $ 5.3 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 26, 2020 | Jun. 28, 2019 | |
Net Earnings | $ 101,650 | $ 174,886 |
Adjustments to reconcile net earnings to net cash provided by operating activities | ||
Depreciation and amortization | 26,966 | 24,087 |
Deferred income taxes | 1,366 | (3,881) |
Share-based compensation | 15,445 | 17,548 |
Impairment | 34,962 | 0 |
Change in | ||
Accounts receivable | (19,705) | (16,051) |
Inventories | (22,662) | (13,157) |
Trade accounts payable | 342 | 4,603 |
Salaries and incentives | (16,677) | (18,514) |
Retirement benefits and deferred compensation | 6,134 | 5,780 |
Other accrued liabilities | 12,578 | (10,789) |
Other | 2,151 | (690) |
Net cash provided by operating activities | 142,550 | 163,822 |
Cash Flows From Investing Activities | ||
Property, plant and equipment additions | (32,613) | (70,186) |
Acquisition of businesses, net of cash acquired | (27,173) | (6,176) |
Other | (245) | (828) |
Net cash provided by (used in) investing activities | (60,031) | (77,190) |
Cash Flows From Financing Activities | ||
Borrowings (payments) on short-term lines of credit, net | (768) | (3,767) |
Borrowings on long-term lines of credit | 250,000 | 23,944 |
Payments on long-term debt and lines of credit | 0 | (36,453) |
Common stock issued | 42,217 | 33,954 |
Common stock repurchased | (102,143) | (2,438) |
Payment, Tax Withholding, Share-based Payment Arrangement | 1,796 | 1,268 |
Cash dividends paid | (58,490) | (53,075) |
Net cash provided by (used in) financing activities | 129,020 | (39,103) |
Effect of exchange rate changes on cash | 196 | 1,236 |
Net increase (decrease) in cash and cash equivalents | 211,735 | 48,765 |
Cash and Cash Equivalents | ||
Beginning of year | 220,973 | 132,118 |
End of period | $ 432,708 | $ 180,883 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning Balance at Dec. 28, 2018 | $ 751,873 | $ 165,171 | $ 510,825 | $ 220,734 | $ (144,857) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Shares issued | 32,685 | 1,621 | 31,064 | 0 | 0 |
Stock compensation cost | 14,281 | 0 | 14,281 | 0 | 0 |
Net Earnings | 174,886 | 0 | 0 | 174,886 | 0 |
Dividends declared | (53,312) | 0 | 0 | (53,312) | 0 |
Other comprehensive income (loss) | 5,545 | 0 | 0 | 0 | 5,545 |
Ending Balance at Jun. 28, 2019 | 925,958 | 166,792 | 556,170 | 342,308 | (139,312) |
Beginning Balance at Mar. 29, 2019 | 844,438 | 166,364 | 539,067 | 281,038 | (142,031) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Shares issued | 9,106 | 428 | 8,678 | 0 | 0 |
Stock compensation cost | 8,425 | 0 | 8,425 | 0 | 0 |
Net Earnings | 88,137 | 0 | 0 | 88,137 | 0 |
Dividends declared | (26,867) | 0 | 0 | (26,867) | 0 |
Other comprehensive income (loss) | 2,719 | 0 | 0 | 0 | 2,719 |
Ending Balance at Jun. 28, 2019 | 925,958 | 166,792 | 556,170 | 342,308 | (139,312) |
Beginning Balance at Dec. 27, 2019 | 1,024,931 | 167,287 | 578,440 | 448,991 | (169,787) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Shares issued | 41,151 | 1,733 | 39,418 | 0 | 0 |
Shares repurchased | (102,143) | (2,327) | (8,047) | (91,769) | 0 |
Stock compensation cost | 13,992 | 0 | 13,992 | 0 | 0 |
Net Earnings | 101,650 | 0 | 0 | 101,650 | 0 |
Dividends declared | (58,718) | 0 | 0 | (58,718) | 0 |
Other comprehensive income (loss) | 6,105 | 0 | 0 | 0 | 6,105 |
Ending Balance at Jun. 26, 2020 | 1,026,968 | 166,693 | 623,803 | 400,154 | (163,682) |
Beginning Balance at Mar. 27, 2020 | 1,018,658 | 166,840 | 612,698 | 411,450 | (172,330) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Shares issued | 4,064 | 113 | 3,951 | 0 | 0 |
Shares repurchased | (12,114) | (260) | (904) | (10,950) | 0 |
Stock compensation cost | 8,058 | 0 | 8,058 | 0 | 0 |
Net Earnings | 28,832 | 0 | 0 | 28,832 | 0 |
Dividends declared | (29,178) | 0 | 0 | (29,178) | 0 |
Other comprehensive income (loss) | 8,648 | 0 | 0 | 0 | 8,648 |
Ending Balance at Jun. 26, 2020 | $ 1,026,968 | $ 166,693 | $ 623,803 | $ 400,154 | $ (163,682) |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Unaudited) Consolidated Statements of Shareholders' Equity (Unaudited) Parenthetical - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||
Common Stock, Dividends, Per Share, Declared | $ 0.175 | $ 0.160 | $ 0.350 | $ 0.320 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 26, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated balance sheet of Graco Inc. and Subsidiaries (the “Company”) as of June 26, 2020 and the related statements of earnings, comprehensive income and shareholders' equity for the three and six months ended June 26, 2020 and June 28, 2019, and cash flows for the six months ended June 26, 2020 and June 28, 2019 have been prepared by the Company and have not been audited. In the opinion of management, these consolidated financial statements reflect all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position of the Company as of June 26, 2020, and the results of operations and cash flows for all periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. Therefore, these statements should be read in conjunction with the financial statements and notes thereto included in the Company’s 2019 Annual Report on Form 10-K. The results of operations for interim periods are not necessarily indicative of results that will be realized for the full fiscal year. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 26, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company has three reportable segments: Industrial, Process and Contractor. Sales and operating earnings by segment were as follows (in thousands): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Net Sales Industrial $ 133,287 $ 188,507 $ 291,971 $ 377,607 Process 77,759 85,064 163,837 171,958 Contractor 155,846 154,757 284,651 283,633 Total $ 366,892 $ 428,328 $ 740,459 $ 833,198 Operating Earnings Industrial $ 37,001 $ 64,428 $ 87,234 $ 129,631 Process 11,672 18,378 29,783 38,392 Contractor 41,109 40,054 69,739 66,593 Unallocated corporate (expense) (10,047) (10,499) (17,209) (17,728) Impairment (34,962) — (34,962) — Total $ 44,773 $ 112,361 $ 134,585 $ 216,888 Assets by segment were as follows (in thousands): June 26, December 27, Industrial $ 621,314 $ 615,486 Process 403,083 387,216 Contractor 420,983 368,832 Unallocated corporate 517,079 320,676 Total $ 1,962,459 $ 1,692,210 Geographic information follows (in thousands): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Net Sales (based on customer location) United States $ 205,789 $ 221,565 $ 404,032 $ 424,450 Other countries 161,103 206,763 336,427 408,748 Total $ 366,892 $ 428,328 $ 740,459 $ 833,198 June 26, December 27, Long-lived Assets United States $ 278,576 $ 268,864 Other countries 48,900 56,682 Total $ 327,476 $ 325,546 |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 26, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Net earnings available to common shareholders $ 28,832 $ 88,137 $ 101,650 $ 174,886 Weighted average shares outstanding for basic earnings per share 166,663 166,684 167,320 166,150 Dilutive effect of stock options computed using the treasury stock method and the average market price 3,886 5,363 4,276 5,303 Weighted average shares outstanding for diluted earnings per share 170,549 172,047 171,596 171,453 Basic earnings per share $ 0.17 $ 0.53 $ 0.61 $ 1.05 Diluted earnings per share $ 0.17 $ 0.51 $ 0.59 $ 1.02 Stock options to purchase 2,530,000 and 1,532,000 shares were not included in the June 26, 2020 and June 28, 2019 computations of diluted earnings per share, respectively, because they would have been anti-dilutive. |
Share-Based Awards
Share-Based Awards | 6 Months Ended |
Jun. 26, 2020 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
Share-Based Awards | Share-Based Awards Options on common shares granted and outstanding, as well as the weighted average exercise price, are shown below (in thousands, except exercise prices): Option Weighted Average Options Weighted Average Outstanding, December 27, 2019 12,112 $ 28.91 8,231 $ 23.75 Granted 1,399 55.26 Exercised (1,371) 19.36 Canceled (22) 45.43 Outstanding, June 26, 2020 12,118 $ 32.84 8,424 $ 26.62 The Company recognized year-to-date share-based compensation of $15.4 million in 2020 and $17.5 million in 2019. As of June 26, 2020, there was $14.6 million of unrecognized compensation cost related to unvested options, expected to be recognized over a weighted average period of 2.2 years. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions and results: Six Months Ended June 26, June 28, Expected life in years 7.5 7.5 Interest rate 1.5 % 2.6 % Volatility 22.0 % 24.6 % Dividend yield 1.3 % 1.4 % Weighted average fair value per share $ 12.18 $ 12.26 Under the Company’s Employee Stock Purchase Plan, the Company issued 400,000 shares in 2020 and 398,000 shares in 2019. The fair value of the employees’ purchase rights under this Plan was estimated on the date of grant. The benefit of the 15 percent discount from the lesser of the fair market value per common share on the first day and the last day of the plan year was added to the fair value of the employees’ purchase rights determined using the Black-Scholes option-pricing model with the following assumptions and results: Six Months Ended June 26, June 28, Expected life in years 1.0 1.0 Interest rate 1.5 % 2.6 % Volatility 21.9 % 22.7 % Dividend yield 1.4 % 1.4 % Weighted average fair value per share $ 11.55 $ 11.36 |
Retirement Benefits
Retirement Benefits | 6 Months Ended |
Jun. 26, 2020 | |
Defined Benefit Plan [Abstract] | |
Retirement Benefits | Retirement Benefits The components of net periodic benefit cost for retirement benefit plans were as follows (in thousands): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Pension Benefits Service cost $ 2,193 $ 1,635 $ 4,615 $ 3,644 Interest cost 3,227 3,572 6,634 7,310 Expected return on assets (4,651) (4,216) (9,401) (8,575) Amortization and other 2,517 1,838 5,238 3,817 Net periodic benefit cost $ 3,286 $ 2,829 $ 7,086 $ 6,196 Postretirement Medical Service cost $ 130 $ 123 $ 305 $ 273 Interest cost 260 264 508 581 Amortization 190 29 367 137 Net periodic benefit cost $ 580 $ 416 $ 1,180 $ 991 |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 26, 2020 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Changes in components of accumulated other comprehensive income (loss), net of tax were (in thousands): Pension and Cumulative Total Three Months Ended June 26, 2020 Balance, March 27, 2020 $ (111,587) $ (60,743) $ (172,330) Other comprehensive income (loss) before reclassifications — 6,756 6,756 Reclassified to pension cost and deferred tax 1,892 — 1,892 Balance, June 26, 2020 $ (109,695) $ (53,987) $ (163,682) Six Months Ended June 26, 2020 Balance, December 27, 2019 $ (113,721) $ (56,066) $ (169,787) Other comprehensive income (loss) before reclassifications — 2,079 2,079 Reclassified to pension cost and deferred tax 4,026 — 4,026 Balance, June 26, 2020 $ (109,695) $ (53,987) $ (163,682) Three Months Ended June 28, 2019 Balance, March 29, 2019 $ (85,232) $ (56,799) $ (142,031) Other comprehensive income (loss) before reclassifications — 1,232 1,232 Reclassified to pension cost and deferred tax 1,487 — 1,487 Balance, June 28, 2019 $ (83,745) $ (55,567) $ (139,312) Six Months Ended June 28, 2019 Balance, December 28, 2018 $ (86,889) $ (57,968) $ (144,857) Other comprehensive income (loss) before reclassifications — 2,401 2,401 Reclassified to pension cost and deferred tax 3,144 — 3,144 Balance, June 28, 2019 $ (83,745) $ (55,567) $ (139,312) |
Inventories
Inventories | 6 Months Ended |
Jun. 26, 2020 | |
Inventory, Net [Abstract] | |
Inventories | Inventories Major components of inventories were as follows (in thousands): June 26, December 27, Finished products and components $ 145,299 $ 132,128 Products and components in various stages of completion 86,075 86,957 Raw materials and purchased components 123,941 117,026 Subtotal 355,315 336,111 Reduction to LIFO cost (63,873) (62,878) Total $ 291,442 $ 273,233 |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 26, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Components of other intangible assets were (dollars in thousands): Finite Life Indefinite Life Customer Patents and Trademarks, Trade Total As of June 26, 2020 Cost $ 187,012 $ 25,313 $ 1,200 $ 61,920 $ 275,445 Accumulated amortization (87,704) (11,706) (499) — (99,909) Foreign currency translation (9,795) (828) — (2,642) (13,265) Book value $ 89,513 $ 12,779 $ 701 $ 59,278 $ 162,271 Weighted average life in years 13 10 4 N/A As of December 27, 2019 Cost $ 186,310 $ 20,413 $ 1,020 $ 61,920 $ 269,663 Accumulated amortization (80,764) (10,526) (650) — (91,940) Foreign currency translation (10,412) (885) (73) (3,730) (15,100) Book value $ 95,134 $ 9,002 $ 297 $ 58,190 $ 162,623 Weighted average life in years 13 10 4 N/A Amortization of intangibles for the quarter was $4.1 million in 2020 and $3.8 million in 2019 and for the year to date was $8.2 million in 2020 and $7.7 million in 2019. Estimated annual amortization expense based on the current carrying amount of other intangible assets is as follows (in thousands): 2020 2021 2022 2023 2024 Thereafter Estimated Amortization Expense $ 16,595 $ 16,570 $ 16,483 $ 15,552 $ 14,009 $ 32,007 Changes in the carrying amount of goodwill for each reportable segment were (in thousands): Industrial Process Contractor Total Balance, December 27, 2019 $ 177,112 $ 110,997 $ 19,554 $ 307,663 Additions, adjustments from business acquisitions — 29,273 — 29,273 Foreign currency translation 2,482 (683) — 1,799 Balance, June 26, 2020 $ 179,594 $ 139,587 $ 19,554 $ 338,735 In the second quarter the Company completed the acquisition of a business that is not material to the consolidated financial statements. |
Other Current Liabilities
Other Current Liabilities | 6 Months Ended |
Jun. 26, 2020 | |
Accrued Liabilities, Current [Abstract] | |
Other Current Liabilities | Other Current Liabilities Components of other current liabilities were (in thousands): June 26, December 27, Accrued self-insurance retentions $ 7,622 $ 7,570 Accrued warranty and service liabilities 12,578 12,785 Accrued trade promotions 6,144 8,390 Payable for employee stock purchases 6,257 13,722 Customer advances and deferred revenue 50,281 33,138 Income taxes payable 16,839 8,706 Right of return refund liability 13,730 13,791 Operating lease liability, current 8,822 7,690 Loss reserve 24,608 — Other 29,956 37,145 Total $ 176,837 $ 142,937 In the second quarter, the Company entered into negotiations to sell its U.K.-based valve business (“Alco”). Based on the negotiations to sell, the Company revalued its investment in Alco, recording impairment charges of $35 million. A loss reserve was recognized within other current liabilities, representing $24 million of previously unrealized foreign currency translation losses recorded in accumulated other comprehensive income plus other disposal costs. The sale of Alco was completed in the third quarter, subject to post-closing adjustments. A liability is established for estimated future warranty and service claims that relate to current and prior period sales. The Company estimates warranty costs based on historical claim experience and other factors including evaluating specific product warranty issues. Following is a summary of activity in accrued warranty and service liabilities (in thousands): Balance, December 27, 2019 $ 12,785 Assumed in business acquisition 155 Charged to expense 3,318 Margin on parts sales reversed 1,080 Reductions for claims settled (4,760) Balance, June 26, 2020 $ 12,578 Deferred Revenue Revenue is deferred when cash payments are received or due in advance of performance, including amounts which are refundable. This is also the case for services associated with certain product sales. The balance in the deferred revenue and customer advances was $50.3 million as of June 26, 2020 and $33.1 million as of December 27, 2019. Net sales for the year to date included $14.2 million in 2020 and $29.9 million in 2019 that related to deferred revenue as of the beginning of each period. |
Debt (Notes)
Debt (Notes) | 6 Months Ended |
Jun. 26, 2020 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | DebtOn January 29, 2020, the Company entered into a master note agreement with a sole lender that expires on January 29, 2023. The note agreement sets forth certain terms on which the Company may issue, and affiliates of the lender may purchase, up to $200 million of the Company’s senior notes. Interest on the senior notes will be determined at the time of issuance, at a fixed or LIBOR-based floating rate at the option of the Company, provided that the maximum aggregate principal amount of notes bearing interest at a floating rate may not exceed $100 million. Fixed rate notes issued under the agreement will mature no longer than 12 years from date of issuance and variable rate notes will mature no longer than 10 years from issuance. Under terms of the note agreement, the Company is required to maintain certain financial ratios as to cash flow leverage and interest coverage similar to the requirements of its other debt agreements. There were no senior notes issued under the note agreement as of June 26, 2020.In March 2020, the Company borrowed $250 million under its $500 million revolving credit facility in order to increase its cash position and preserve financial flexibility. The proceeds from the advance are available to be used for working capital, general corporate or other purposes. |
Fair Value
Fair Value | 6 Months Ended |
Jun. 26, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Assets and liabilities measured at fair value on a recurring basis and fair value measurement level were as follows (in thousands): Level June 26, December 27, Assets Cash surrender value of life insurance 2 $ 16,108 $ 17,702 Forward exchange contracts 2 156 — Total assets at fair value $ 16,264 $ 17,702 Liabilities Contingent consideration 3 $ 11,565 $ 9,072 Deferred compensation 2 4,415 4,719 Forward exchange contracts 2 — 87 Total liabilities at fair value $ 15,980 $ 13,878 Contracts insuring the lives of certain employees who are eligible to participate in certain non-qualified pension and deferred compensation plans are held in trust. Cash surrender value of the contracts is based on performance measurement funds that shadow the deferral investment allocations made by participants in certain deferred compensation plans. Changes in cash surrender value are recorded in other non-operating expense. The deferred compensation liability balances are valued based on amounts allocated by participants to the underlying performance measurement funds. Contingent consideration liability represents the estimated value (using a probability-weighted expected return approach) of future payments to be made to previous owners of certain acquired businesses based on future revenues. Long-term notes payable with fixed interest rates had a carrying amount of $150 million and estimated fair value of $165 million as of both June 26, 2020 and December 27, 2019. The fair value of variable rate borrowings approximates carrying value. The Company uses significant other observable inputs to estimate fair value (level 2 of the fair value hierarchy) based on the present value of future cash flows and rates that would be available for issuance of debt with similar terms and remaining maturities. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 26, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | Recent Accounting Pronouncements Adoption of New Accounting Standard In June 2016, the Financial Accounting Standards Board (FASB) issued a final standard on accounting for credit losses. The new standard is effective for the Company in fiscal 2020 and requires a change in credit loss calculations using the expected loss method. There was no significant impact on earnings or financial condition from the adoption of the new standard. Accounting Policy Receivables reflected in the financial statements represent the net amount expected to be collected. An allowance for credit losses is established based on expected losses. Expected losses are estimated by reviewing individual accounts, considering aging, financial condition of the debtor, recent payment history, current and forecast economic conditions and other relevant factors. The Company evaluates the adequacy of the worldwide allowance amount quarterly, considering individual account reviews, historical write-offs, current sales levels and expected economic factors. Accounts Receivable Accounts receivable includes trade receivables of $270 million and other receivables of $13 million as of June 26, 2020 and $256 million and $11 million, respectively, as of December 27, 2019. Allowance for Credit Losses Following is a summary of activity in the allowance for credit losses (in thousands): Three Months Ended Six Months Ended June 26, 2020 June 28, 2019 June 26, 2020 June 28, 2019 Balance, beginning $ 4,798 $ 4,412 $ 4,828 $ 4,771 Additions charged to costs and expenses 314 192 631 222 Deductions from reserves (1) (38) 146 (291) (690) Other additions (deductions) (2) 85 (435) (9) 12 Balance, ending $ 5,159 $ 4,315 $ 5,159 $ 4,315 (1) Represents amounts determined to be uncollectible and charged against reserves, net of collections on accounts previously charged against reserves. (2) Includes amounts assumed or established in connection with acquisitions and effects of foreign currency translation. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 6 Months Ended |
Jun. 26, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Loans and Leases Receivable, Allowance for Loan Losses Policy [Policy Text Block] | Adoption of New Accounting Standard In June 2016, the Financial Accounting Standards Board (FASB) issued a final standard on accounting for credit losses. The new standard is effective for the Company in fiscal 2020 and requires a change in credit loss calculations using the expected loss method. There was no significant impact on earnings or financial condition from the adoption of the new standard. Accounting Policy Receivables reflected in the financial statements represent the net amount expected to be collected. An allowance for credit losses is established based on expected losses. Expected losses are estimated by reviewing individual accounts, considering aging, financial condition of the debtor, recent payment history, current and forecast economic conditions and other relevant factors. The Company evaluates the adequacy of the worldwide allowance amount quarterly, considering individual account reviews, historical write-offs, current sales levels and expected economic factors. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting - Operations and Assets | Sales and operating earnings by segment were as follows (in thousands): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Net Sales Industrial $ 133,287 $ 188,507 $ 291,971 $ 377,607 Process 77,759 85,064 163,837 171,958 Contractor 155,846 154,757 284,651 283,633 Total $ 366,892 $ 428,328 $ 740,459 $ 833,198 Operating Earnings Industrial $ 37,001 $ 64,428 $ 87,234 $ 129,631 Process 11,672 18,378 29,783 38,392 Contractor 41,109 40,054 69,739 66,593 Unallocated corporate (expense) (10,047) (10,499) (17,209) (17,728) Impairment (34,962) — (34,962) — Total $ 44,773 $ 112,361 $ 134,585 $ 216,888 Assets by segment were as follows (in thousands): June 26, December 27, Industrial $ 621,314 $ 615,486 Process 403,083 387,216 Contractor 420,983 368,832 Unallocated corporate 517,079 320,676 Total $ 1,962,459 $ 1,692,210 |
Segment Reporting - Geographic | Geographic information follows (in thousands): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Net Sales (based on customer location) United States $ 205,789 $ 221,565 $ 404,032 $ 424,450 Other countries 161,103 206,763 336,427 408,748 Total $ 366,892 $ 428,328 $ 740,459 $ 833,198 June 26, December 27, Long-lived Assets United States $ 278,576 $ 268,864 Other countries 48,900 56,682 Total $ 327,476 $ 325,546 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted EPS | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share amounts): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Net earnings available to common shareholders $ 28,832 $ 88,137 $ 101,650 $ 174,886 Weighted average shares outstanding for basic earnings per share 166,663 166,684 167,320 166,150 Dilutive effect of stock options computed using the treasury stock method and the average market price 3,886 5,363 4,276 5,303 Weighted average shares outstanding for diluted earnings per share 170,549 172,047 171,596 171,453 Basic earnings per share $ 0.17 $ 0.53 $ 0.61 $ 1.05 Diluted earnings per share $ 0.17 $ 0.51 $ 0.59 $ 1.02 |
Share-Based Awards (Tables)
Share-Based Awards (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |
Options Activity and Outstanding | Options on common shares granted and outstanding, as well as the weighted average exercise price, are shown below (in thousands, except exercise prices): Option Weighted Average Options Weighted Average Outstanding, December 27, 2019 12,112 $ 28.91 8,231 $ 23.75 Granted 1,399 55.26 Exercised (1,371) 19.36 Canceled (22) 45.43 Outstanding, June 26, 2020 12,118 $ 32.84 8,424 $ 26.62 |
Options Fair Value Inputs | The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions and results: Six Months Ended June 26, June 28, Expected life in years 7.5 7.5 Interest rate 1.5 % 2.6 % Volatility 22.0 % 24.6 % Dividend yield 1.3 % 1.4 % Weighted average fair value per share $ 12.18 $ 12.26 |
ESPP Fair Value Inputs | The benefit of the 15 percent discount from the lesser of the fair market value per common share on the first day and the last day of the plan year was added to the fair value of the employees’ purchase rights determined using the Black-Scholes option-pricing model with the following assumptions and results: Six Months Ended June 26, June 28, Expected life in years 1.0 1.0 Interest rate 1.5 % 2.6 % Volatility 21.9 % 22.7 % Dividend yield 1.4 % 1.4 % Weighted average fair value per share $ 11.55 $ 11.36 |
Retirement Benefits (Tables)
Retirement Benefits (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Defined Benefit Plan [Abstract] | |
Components of Net Periodic Benefit Cost | The components of net periodic benefit cost for retirement benefit plans were as follows (in thousands): Three Months Ended Six Months Ended June 26, June 28, June 26, June 28, Pension Benefits Service cost $ 2,193 $ 1,635 $ 4,615 $ 3,644 Interest cost 3,227 3,572 6,634 7,310 Expected return on assets (4,651) (4,216) (9,401) (8,575) Amortization and other 2,517 1,838 5,238 3,817 Net periodic benefit cost $ 3,286 $ 2,829 $ 7,086 $ 6,196 Postretirement Medical Service cost $ 130 $ 123 $ 305 $ 273 Interest cost 260 264 508 581 Amortization 190 29 367 137 Net periodic benefit cost $ 580 $ 416 $ 1,180 $ 991 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Stockholders' Equity Note [Abstract] | |
Changes in AOCI | Changes in components of accumulated other comprehensive income (loss), net of tax were (in thousands): Pension and Cumulative Total Three Months Ended June 26, 2020 Balance, March 27, 2020 $ (111,587) $ (60,743) $ (172,330) Other comprehensive income (loss) before reclassifications — 6,756 6,756 Reclassified to pension cost and deferred tax 1,892 — 1,892 Balance, June 26, 2020 $ (109,695) $ (53,987) $ (163,682) Six Months Ended June 26, 2020 Balance, December 27, 2019 $ (113,721) $ (56,066) $ (169,787) Other comprehensive income (loss) before reclassifications — 2,079 2,079 Reclassified to pension cost and deferred tax 4,026 — 4,026 Balance, June 26, 2020 $ (109,695) $ (53,987) $ (163,682) Three Months Ended June 28, 2019 Balance, March 29, 2019 $ (85,232) $ (56,799) $ (142,031) Other comprehensive income (loss) before reclassifications — 1,232 1,232 Reclassified to pension cost and deferred tax 1,487 — 1,487 Balance, June 28, 2019 $ (83,745) $ (55,567) $ (139,312) Six Months Ended June 28, 2019 Balance, December 28, 2018 $ (86,889) $ (57,968) $ (144,857) Other comprehensive income (loss) before reclassifications — 2,401 2,401 Reclassified to pension cost and deferred tax 3,144 — 3,144 Balance, June 28, 2019 $ (83,745) $ (55,567) $ (139,312) |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Inventory, Net [Abstract] | |
Components of Inventories | Major components of inventories were as follows (in thousands): June 26, December 27, Finished products and components $ 145,299 $ 132,128 Products and components in various stages of completion 86,075 86,957 Raw materials and purchased components 123,941 117,026 Subtotal 355,315 336,111 Reduction to LIFO cost (63,873) (62,878) Total $ 291,442 $ 273,233 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | Components of other intangible assets were (dollars in thousands): Finite Life Indefinite Life Customer Patents and Trademarks, Trade Total As of June 26, 2020 Cost $ 187,012 $ 25,313 $ 1,200 $ 61,920 $ 275,445 Accumulated amortization (87,704) (11,706) (499) — (99,909) Foreign currency translation (9,795) (828) — (2,642) (13,265) Book value $ 89,513 $ 12,779 $ 701 $ 59,278 $ 162,271 Weighted average life in years 13 10 4 N/A As of December 27, 2019 Cost $ 186,310 $ 20,413 $ 1,020 $ 61,920 $ 269,663 Accumulated amortization (80,764) (10,526) (650) — (91,940) Foreign currency translation (10,412) (885) (73) (3,730) (15,100) Book value $ 95,134 $ 9,002 $ 297 $ 58,190 $ 162,623 Weighted average life in years 13 10 4 N/A |
Future Amortization Expense | Estimated annual amortization expense based on the current carrying amount of other intangible assets is as follows (in thousands): 2020 2021 2022 2023 2024 Thereafter Estimated Amortization Expense $ 16,595 $ 16,570 $ 16,483 $ 15,552 $ 14,009 $ 32,007 |
Goodwill Rollforward | Changes in the carrying amount of goodwill for each reportable segment were (in thousands): Industrial Process Contractor Total Balance, December 27, 2019 $ 177,112 $ 110,997 $ 19,554 $ 307,663 Additions, adjustments from business acquisitions — 29,273 — 29,273 Foreign currency translation 2,482 (683) — 1,799 Balance, June 26, 2020 $ 179,594 $ 139,587 $ 19,554 $ 338,735 |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Accrued Liabilities, Current [Abstract] | |
Components of Other Current Liabilities | Components of other current liabilities were (in thousands): June 26, December 27, Accrued self-insurance retentions $ 7,622 $ 7,570 Accrued warranty and service liabilities 12,578 12,785 Accrued trade promotions 6,144 8,390 Payable for employee stock purchases 6,257 13,722 Customer advances and deferred revenue 50,281 33,138 Income taxes payable 16,839 8,706 Right of return refund liability 13,730 13,791 Operating lease liability, current 8,822 7,690 Loss reserve 24,608 — Other 29,956 37,145 Total $ 176,837 $ 142,937 |
Accrued Warranty Activity | Following is a summary of activity in accrued warranty and service liabilities (in thousands): Balance, December 27, 2019 $ 12,785 Assumed in business acquisition 155 Charged to expense 3,318 Margin on parts sales reversed 1,080 Reductions for claims settled (4,760) Balance, June 26, 2020 $ 12,578 |
Fair Value (Tables)
Fair Value (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Schedule | Assets and liabilities measured at fair value on a recurring basis and fair value measurement level were as follows (in thousands): Level June 26, December 27, Assets Cash surrender value of life insurance 2 $ 16,108 $ 17,702 Forward exchange contracts 2 156 — Total assets at fair value $ 16,264 $ 17,702 Liabilities Contingent consideration 3 $ 11,565 $ 9,072 Deferred compensation 2 4,415 4,719 Forward exchange contracts 2 — 87 Total liabilities at fair value $ 15,980 $ 13,878 |
Recent Accounting Pronounceme_3
Recent Accounting Pronouncements Allowance for Credit Losses (Tables) | 6 Months Ended |
Jun. 26, 2020 | |
Allowance for Credit Losses [Abstract] | |
Accounts Receivable, Allowance for Credit Loss [Table Text Block] | Following is a summary of activity in the allowance for credit losses (in thousands): Three Months Ended Six Months Ended June 26, 2020 June 28, 2019 June 26, 2020 June 28, 2019 Balance, beginning $ 4,798 $ 4,412 $ 4,828 $ 4,771 Additions charged to costs and expenses 314 192 631 222 Deductions from reserves (1) (38) 146 (291) (690) Other additions (deductions) (2) 85 (435) (9) 12 Balance, ending $ 5,159 $ 4,315 $ 5,159 $ 4,315 |
Segment Reporting Information -
Segment Reporting Information - Operations and Assets (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 26, 2020USD ($) | Jun. 28, 2019USD ($) | Jun. 26, 2020USD ($)segment | Jun. 28, 2019USD ($) | Dec. 27, 2019USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of reportable segments | segment | 3 | ||||
Revenues | $ 366,892 | $ 428,328 | $ 740,459 | $ 833,198 | |
Operating Earnings | 44,773 | 112,361 | 134,585 | 216,888 | |
Total Assets | 1,962,459 | 1,962,459 | $ 1,692,210 | ||
Operating Segments | Industrial | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 133,287 | 188,507 | 291,971 | 377,607 | |
Operating Earnings | 37,001 | 64,428 | 87,234 | 129,631 | |
Total Assets | 621,314 | 621,314 | 615,486 | ||
Operating Segments | Process | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 77,759 | 85,064 | 163,837 | 171,958 | |
Operating Earnings | 11,672 | 18,378 | 29,783 | 38,392 | |
Total Assets | 403,083 | 403,083 | 387,216 | ||
Operating Segments | Contractor | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 155,846 | 154,757 | 284,651 | 283,633 | |
Operating Earnings | 41,109 | 40,054 | 69,739 | 66,593 | |
Total Assets | 420,983 | 420,983 | 368,832 | ||
Unallocated corporate | |||||
Segment Reporting Information [Line Items] | |||||
Operating Earnings | (10,047) | (10,499) | (17,209) | (17,728) | |
Impairment - Segment Information | (34,962) | $ 0 | (34,962) | $ 0 | |
Total Assets | $ 517,079 | $ 517,079 | $ 320,676 |
Segment Reporting Information_2
Segment Reporting Information - Geographic (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | Dec. 27, 2019 | |
Geographic Information [Line Items] | |||||
Revenues | $ 366,892 | $ 428,328 | $ 740,459 | $ 833,198 | |
Long-lived Assets | 327,476 | 327,476 | $ 325,546 | ||
United States | |||||
Geographic Information [Line Items] | |||||
Revenues | 205,789 | 221,565 | 404,032 | 424,450 | |
Long-lived Assets | 278,576 | 278,576 | 268,864 | ||
Other countries | |||||
Geographic Information [Line Items] | |||||
Revenues | 161,103 | $ 206,763 | 336,427 | $ 408,748 | |
Long-lived Assets | $ 48,900 | $ 48,900 | $ 56,682 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
Earnings Per Share [Abstract] | ||||
Net earnings available to common shareholders | $ 28,832 | $ 88,137 | $ 101,650 | $ 174,886 |
Weighted average shares outstanding for basic earnings per share | 166,663 | 166,684 | 167,320 | 166,150 |
Dilutive effect of stock options computed using the treasury stock method and the average market price | 3,886 | 5,363 | 4,276 | 5,303 |
Weighted average shares outstanding for diluted earnings per share | 170,549 | 172,047 | 171,596 | 171,453 |
Basic earnings per share | $ 0.17 | $ 0.53 | $ 0.61 | $ 1.05 |
Diluted earnings per share | $ 0.17 | $ 0.51 | $ 0.59 | $ 1.02 |
Antidilutive securities excluded from the computation of diluted earnings per share | 2,530 | 1,532 |
Share-Based Awards - Options Ac
Share-Based Awards - Options Activity and Outstanding (Details) - $ / shares shares in Thousands | 6 Months Ended | |
Jun. 26, 2020 | Dec. 27, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Beginning (in shares) | 12,112 | |
Options granted (in shares) | 1,399 | |
Options exercised (in shares) | (1,371) | |
Options canceled (in shares) | (22) | |
Ending (in shares) | 12,118 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Beginning (dollars per share) | $ 28.91 | |
Granted (dollars per share) | 55.26 | |
Exercised (dollars per share) | 19.36 | |
Canceled (dollars per share) | 45.43 | |
Ending (dollars per share) | $ 32.84 | |
Options exercisable (in shares) | 8,424 | 8,231 |
Weighted average exercise price of exercisable options (dollars per share) | $ 26.62 | $ 23.75 |
Share-Based Awards - Options Fa
Share-Based Awards - Options Fair Value Inputs (Details) - Stock Option - $ / shares | 6 Months Ended | |
Jun. 26, 2020 | Jun. 28, 2019 | |
Fair Value Assumptions and Methodology [Abstract] | ||
Expected life in years | 7 years 6 months | 7 years 6 months |
Interest rate | 1.50% | 2.60% |
Volatility | 22.00% | 24.60% |
Dividend yield | 1.30% | 1.40% |
Weighted average fair value per share (in dollars per share) | $ 12.18 | $ 12.26 |
Share-Based Awards - ESPP Fair
Share-Based Awards - ESPP Fair Value Inputs (Details) - Employee Stock Purchase Plan - $ / shares | 6 Months Ended | |
Jun. 26, 2020 | Jun. 28, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life in years | 1 year | 1 year |
Interest rate | 1.50% | 2.60% |
Volatility | 21.90% | 22.70% |
Dividend yield | 1.40% | 1.40% |
Weighted average fair value per share (in dollars per share) | $ 11.55 | $ 11.36 |
Share-Based Awards - Narrative
Share-Based Awards - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 26, 2020 | Jun. 28, 2019 | |
Share-based Payment Arrangement [Abstract] | ||
Share-based compensation expense | $ 15.4 | $ 17.5 |
Unrecognized compensation cost | $ 14.6 | |
Weighted average recognition period | 2 years 2 months 12 days | |
Employee Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Employee stock purchase plan shares issued | 400,000 | 398,000 |
Stock purchase plan discount from market value | 15.00% |
Retirement Benefits (Details)
Retirement Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 2,193 | $ 1,635 | $ 4,615 | $ 3,644 |
Interest cost | 3,227 | 3,572 | 6,634 | 7,310 |
Expected return on assets | (4,651) | (4,216) | (9,401) | (8,575) |
Amortization and other | 2,517 | 1,838 | 5,238 | 3,817 |
Net periodic benefit cost | 3,286 | 2,829 | 7,086 | 6,196 |
Postretirement Medical | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 130 | 123 | 305 | 273 |
Interest cost | 260 | 264 | 508 | 581 |
Amortization | 190 | 29 | 367 | 137 |
Net periodic benefit cost | $ 580 | $ 416 | $ 1,180 | $ 991 |
Shareholders' Equity - Changes
Shareholders' Equity - Changes in AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning Accumulated other comprehensive income (loss) | $ (172,330) | $ (142,031) | $ (169,787) | $ (144,857) |
Other comprehensive income (loss) before reclassifications | 6,756 | 1,232 | 2,079 | 2,401 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 1,892 | 1,487 | 4,026 | 3,144 |
Ending Accumulated other comprehensive income (loss) | (163,682) | (139,312) | (163,682) | (139,312) |
Pension and Postretirement Medical | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning Accumulated other comprehensive income (loss) | (111,587) | (85,232) | (113,721) | (86,889) |
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 | 0 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 1,892 | 1,487 | 4,026 | 3,144 |
Ending Accumulated other comprehensive income (loss) | (109,695) | (83,745) | (109,695) | (83,745) |
Cumulative Translation Adjustment | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning Accumulated other comprehensive income (loss) | (60,743) | (56,799) | (56,066) | (57,968) |
Other comprehensive income (loss) before reclassifications | 6,756 | 1,232 | 2,079 | 2,401 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | 0 | 0 |
Ending Accumulated other comprehensive income (loss) | $ (53,987) | $ (55,567) | $ (53,987) | $ (55,567) |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 26, 2020 | Dec. 27, 2019 |
Inventory, Net [Abstract] | ||
Finished products and components | $ 145,299 | $ 132,128 |
Products and components in various stages of completion | 86,075 | 86,957 |
Raw materials and purchased components | 123,941 | 117,026 |
Inventory gross | 355,315 | 336,111 |
Reduction to LIFO cost | (63,873) | (62,878) |
Total | $ 291,442 | $ 273,233 |
Intangible Assets - Other Intan
Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 26, 2020 | Dec. 27, 2019 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
Total Cost | $ 275,445 | $ 269,663 |
Total Foreign Currency Translation | (13,265) | (15,100) |
Finite Life | ||
Accumulated amortization | (99,909) | (91,940) |
Total Book Value | 162,271 | 162,623 |
Trade Names | ||
Indefinite Life | ||
Cost | 61,920 | 61,920 |
Indefinite-lived Intangible Assets, Foreign Currency Translation Gain (Loss) | (2,642) | (3,730) |
Book value | 59,278 | 58,190 |
Customer Relationships | ||
Finite Life | ||
Cost | 187,012 | 186,310 |
Accumulated amortization | (87,704) | (80,764) |
Foreign currency translation | (9,795) | (10,412) |
Book value | $ 89,513 | $ 95,134 |
Weighted average life in years | 13 years | 13 years |
Patents and Proprietary Technology | ||
Finite Life | ||
Cost | $ 25,313 | $ 20,413 |
Accumulated amortization | (11,706) | (10,526) |
Foreign currency translation | (828) | (885) |
Book value | $ 12,779 | $ 9,002 |
Weighted average life in years | 10 years | 10 years |
Trademarks, Trade Names and Other | ||
Finite Life | ||
Cost | $ 1,200 | $ 1,020 |
Accumulated amortization | (499) | (650) |
Foreign currency translation | 0 | (73) |
Book value | $ 701 | $ 297 |
Weighted average life in years | 4 years | 4 years |
Intangible Assets - Future Amor
Intangible Assets - Future Amortization Expense (Details) $ in Thousands | Jun. 26, 2020USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
Estimated amortization expense 2020 | $ 16,595 |
Estimated amortization expense 2021 | 16,570 |
Estimated amortization expense 2022 | 16,483 |
Estimated amortization expense 2023 | 15,552 |
Estimated amortization expense 2024 | 14,009 |
Estimated amortization expense thereafter | $ 32,007 |
Intangible Assets - Goodwill Ro
Intangible Assets - Goodwill Rollforward (Details) $ in Thousands | 6 Months Ended |
Jun. 26, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 307,663 |
Additions, adjustments from business acquisitions | 29,273 |
Foreign currency translation | 1,799 |
Ending balance | 338,735 |
Industrial | |
Goodwill [Roll Forward] | |
Beginning balance | 177,112 |
Additions, adjustments from business acquisitions | 0 |
Foreign currency translation | 2,482 |
Ending balance | 179,594 |
Process | |
Goodwill [Roll Forward] | |
Beginning balance | 110,997 |
Additions, adjustments from business acquisitions | 29,273 |
Foreign currency translation | (683) |
Ending balance | 139,587 |
Contractor | |
Goodwill [Roll Forward] | |
Beginning balance | 19,554 |
Additions, adjustments from business acquisitions | 0 |
Foreign currency translation | 0 |
Ending balance | $ 19,554 |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 4.1 | $ 3.8 | $ 8.2 | $ 7.7 |
Other Current Liabilities - Com
Other Current Liabilities - Components of Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 26, 2020 | Dec. 27, 2019 |
Other Current Liabilities Details [Abstract] | ||
Accrued self-insurance retentions | $ 7,622 | $ 7,570 |
Accrued warranty and service liabilities | 12,578 | 12,785 |
Accrued trade promotions | 6,144 | 8,390 |
Payable for employee stock purchases | 6,257 | 13,722 |
Customer advances and deferred revenue | 50,281 | 33,138 |
Income taxes payable | 16,839 | 8,706 |
Right of return refund liability | 13,730 | 13,791 |
Operating lease liability, current | 8,822 | 7,690 |
Loss reserve | 24,608 | 0 |
Other | 29,956 | 37,145 |
Total | $ 176,837 | $ 142,937 |
Other Current Liabilities - Acc
Other Current Liabilities - Accrued Warranty Activity (Details) $ in Thousands | 6 Months Ended |
Jun. 26, 2020USD ($) | |
Activity In Accrued Warranty And Service Liabilities Abstract | |
Balance, beginning of year | $ 12,785 |
Standard Product Warranty Accrual, Additions from Business Acquisition | 155 |
Charged to expense | 3,318 |
Margin on parts sales reversed | 1,080 |
Reductions for claims settled | (4,760) |
Balance, end of period | $ 12,578 |
Other Current Liabilities - Nar
Other Current Liabilities - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 26, 2020 | Jun. 28, 2019 | Dec. 27, 2019 | |
Accrued Liabilities, Current [Abstract] | |||
Customer advances and deferred revenue | $ 50,300 | $ 33,100 | |
Contract with Customer, Liability, Revenue Recognized | 14,200 | $ 29,900 | |
Foreign Currency Transaction Loss, before Tax | 24,000 | ||
Impairment - Other Current Liabilities Narrative | $ 35,000 |
Debt (Details)
Debt (Details) $ in Millions | 6 Months Ended |
Jun. 26, 2020USD ($) | |
Debt Instrument [Line Items] | |
Floating Rate Principal Maximum | $ 100 |
Shelf Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Maturity Date | Jan. 29, 2023 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 200 |
Committed Facility [Member] | |
Debt Instrument [Line Items] | |
Line of Credit Facility, Maximum Borrowing Capacity | 500 |
Debt Instrument, Face Amount | $ 250 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Thousands | Jun. 26, 2020 | Dec. 27, 2019 |
Assets | ||
Total assets at fair value | $ 16,264 | $ 17,702 |
Liabilities | ||
Total liabilities at fair value | 15,980 | 13,878 |
Long term debt, carrying amount | 150,000 | 150,000 |
Long term debt, fair value | 165,000 | 165,000 |
Level 2 | ||
Assets | ||
Cash surrender value of life insurance | 16,108 | 17,702 |
Forward exchange contracts | 156 | 0 |
Liabilities | ||
Deferred compensation | 4,415 | 4,719 |
Forward exchange contracts | 0 | 87 |
Level 3 | ||
Liabilities | ||
Contingent consideration | $ 11,565 | $ 9,072 |
Recent Accounting Pronounceme_4
Recent Accounting Pronouncements Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 26, 2020 | Jun. 28, 2019 | Jun. 26, 2020 | Jun. 28, 2019 | Dec. 27, 2019 | |
Credit Loss Disclosures [Abstract] | |||||
Accounts Receivable, before Allowance for Credit Loss | $ 270,000 | $ 270,000 | $ 256,000 | ||
Other Receivables | 13,000 | 13,000 | $ 11,000 | ||
Balance, beginning | 4,798 | $ 4,412 | 4,828 | $ 4,771 | |
Accounts Receivable, Credit Loss Expense (Reversal) | 314 | 192 | 631 | 222 | |
Accounts Receivable, Allowance for Credit Loss, Writeoff | 38 | 146 | 291 | 690 | |
Accounts Receivable, Allowance for Credit Loss, Period Increase (Decrease) | 85 | (435) | (9) | 12 | |
Balance, ending | $ 5,159 | $ 4,315 | $ 5,159 | $ 4,315 |